Former SBI chief Arundhati Bhattacharya has opined that India doesn't need so many public sector banks and that the number of PSBs could be decreased.
According to Bhattacharya, many of the goals that are expected to be achieved through privatization of PSBs can also actually be achieved by enabling the state-owned banks and by leveling the playing field.
She made these remarks to the PTI news agency while responding to a question on former RBI governor D Subbarao's suggestion that the government should come up with a 10-year road map for privatisation of all PSBs.
"The thing is, privatisation has never been the answer to all the ills," she told.
Subbarao had recently suggested that the government should come up with a 10-year road map for privatisation of all PSBs as it would provide much-needed predictability to stakeholders.
With the tide of majoritarian appeasement, fuelled by the ruling political establishment, there are efforts now to even exempt the Gyanvapi mosque-Shringar Gauri dispute in Varanasi from the ambit of the Places of Worship (Special Provisions) Act, 1991.
""Some of them could be privatized. And maybe you know, the stronger ones could still remain public sector banks," said Bhattacharya, who is currently the chairperson and CEO of Salesforce India.
In 2020, the government merged 10 nationalized banks into four large lenders, thereby bringing down the number of PSBs to 12.
While observing that even at this point in time PSBs are not enabled enough, she asserted that wholesale privatization of state-owned banks is not the answer.
Subbarao had also said that the big bang approach to privatization of public sector banks is not desirable but at the same time the issue should not be put on the back burner.
On NITI Aayog's proposal of setting up full-stack digital banks, Bhattacharya said the people in the age group between 17 and 25 seem to be okay with not having brick-and-mortar branches of banks.
"Now, if the customers are there...then at some point of time this (digital banks) will come into play," she said.
Bhattacharya recalled that in 2010, she had approached the RBI seeking a license of this sort and she was told that there was no such proposal or no such thought in the offing.
While admitting that even though there are a lot of risks in setting up full-stack digital banks, she said, "The change is inevitable. You may try to stop it, you may try to delay it. But you can't stop it altogether."